Azerbaijan to Receive $8bln in 2008 from Implementation of Two Large Oil and Gas Projects

Oil&Gas Materials 30 April 2008 12:00 (UTC +04:00)

Azerbaijan, Baku, 30 April / Trend corr S. Aliyev/ "In 2008, Azerbaijan will receive about $8bln from the profit of oil and gas export, as well as from taxation of Azeri-Chirag-Gunashli (ACG) and Shah Deniz projects, if the world's average oil price remains at $50/barrel," Bill Schreder, head of BP Azerbaijan, said while briefing the results of 2007 on 29 April.

According to Schreder, Azerbaijan received $4.3bln in 2007.

ВР operates ACG projects, and is also the technical operator of Shah Deniz.

In Q2 2008, Azerbaijan will be receiving 80% of the profit from the light oil produced in ACG. The remaining part will go to the foreign partners on the project.

The high-gravity oil produced in the ACG is shared between the Azerbaijani Government and the foreign partners on the project, on the basis of R-factor envisaged in PSA. R-factor changes depending on the world oil prices. In 2007, Azerbaijan was receiving only 30% of the oil produced from the field and its foreign partners were receiving 70%. Since 1 January 2008, Azerbaijan has been receiving 55% of the Azeri Light oil from the ACG and its foreign partners - 45%. Since 1 April, Azerbaijan has started receiving 75%.

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